Obama’s Speech on June 1, 2009
April 7, 2009
On March 31, President Obama announced his plan to provide the automakers with additional time to restructure their businesses – 30 days for Chrysler and 60 days for GM. In his speech, he ordered General Motors and Chrysler to accelerate their restructuring efforts and brace for possible bankruptcy.
We have taken the liberty of preparing a speech that Mr. Obama is welcome to deliver at the expiration of GM’s deadline, on June 1.
My fellow Americans, I am here today to talk to you about the future of the American automobile industry. This industry has been a cornerstone of our economy for the past 100 years, and it will remain so in the future. Nonetheless, it is clear to me that major changes are needed for this industry to move forward in the way we all hope and believe it can.
As you know, at the end of March we gave Chrysler a 30-day deadline to work out a deal with Fiat. It was clear that Chrysler was not strong enough to succeed without a partner. Unfortunately, too many obstacles prevented Chrysler from partnering with Fiat. We needed the accession of Chrysler’s owners and creditors, and we needed concessions from the United Auto Workers, but these groups proved unwilling to get on board.
We cannot and will not force concessions upon these constituencies. A merger without the full support of these constituencies is doomed to failure.
We decided the best path for Chrysler was through bankruptcy. This was not an easy decision, and it certainly was not one that we took lightly. But it was the right decision, and today, with the help of accelerated processing through the bankruptcy system, Chrysler is being restructured into a formidable company and a sound strategic partner.
Bankruptcy is not an admission of failure. It is a process whereby companies can rid themselves of burdens created by a bad economy and by bad decisions. The American bankruptcy system is unique in this respect. In any other country, a Chrysler would have faced no choice but to liquidate, creating an unfathomable burden for its employees, suppliers, and the national economy. Our bankruptcy system allows us a better alternative – restructuring.
Today, I have decided that bankruptcy is the best option for GM as well. Over the past 60 days, we have worked tirelessly with GM’s creditors, shareholders, and the United Auto Workers. Although these groups made generous and significant concessions, a deal could not be reached.
We believed that GM needed new leadership and we made that change. I commend Fritz Henderson for his efforts to reach a consensus. My task force has monitored this process closely over the last 60 days, and it is clear that Mr. Henderson made a heroic effort to reach a resolution. But he was ultimately unsuccessful.Display article as PDF for printing.
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